Costco's latest decision has controversy written all over it

There’s a key difference in the way Costco does business compared to its many competitors.

Most stores do not charge customers an annual membership fee just to get in the door and spend money.

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Costco, on the other hand, relies on its membership fees for revenue. Because of that, the company likes to go out of its way to retain members and attract new ones.

Of course, Costco’s low prices have long been a draw for customers. It’s easy to justify the cost of a membership fee when it allows you to save money on groceries every single week of the year.

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Costco also goes out of its way to maintain one of the best return policies in all of retail. Though there are some exceptions to the general rule, for the most part, Costco members can return any item at any time for a complete refund.

It doesn’t get much more reasonable than that.

Costco’s latest decision has controversy written all over it.

Image source&colon; Brooks Kraft LLC/Corbis via Getty Images

Crowded stores are a major pain point for Costco shoppers

Although many people are happy to pay Costco’s annual fee, some customers don’t get to enjoy the shopping experience as much as others because their local stores tend to draw large crowds.

It’s true that Costco stores are massive and can generally accommodate a large number of people at a time.

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But when you’re paying for a membership, it implies a level of exclusivity. And having to wait 10 minutes in the parking lot for a spot to open up seems contrary to that.

Plus, it’s a less pleasant experience to walk through a Costco store scoping out the new inventory when you can barely get down the aisles because they’re filled with people hauling oversized shopping carts.

And when Costco stores get busy, checkout can be a nightmare.

It’s hard enough having to wait in a long line to get to a cashier. But getting through that only to then have to wait for a receipt-checker to do a shopping cart scan adds insult to injury.

Costco takes steps to address crowds, but not all members are happy

Costco offers two membership tiers. A basic Gold Star membership costs $65 a year, while an Executive membership costs $130.

The primary reason customers tend to pay for the Executive tier is to get 2% cash back on their Costco purchases. But now, there’s another perk associated with Costco’s Executive membership.

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Beginning in late June, Costco started offering early shopping hours to its Executive members. This perk was actually part of the Executive package years ago, but Costco did away with it for an extended period of time.

The reintroduction of early shopping hours for Executive members was met with much enthusiasm by some people. But other members aren’t happy.

For many, the move reads like nothing more than a money grab on Costco’s part to get more people to update to the Executive tier. As one Reddit user wrote, “This is disappointing. I am a long time member and have noticed more pushiness than ever from employees to upgrade.”

But some members were happy to learn of the change.

“As a customer I’m thrilled,” one user wrote on Reddit. “I only like to go weekdays at open. Now I can drop kids off and eat and then go right to Costco.”

Meanwhile, some Costco employees took to Reddit to express concerns over the policy change.

“Non executive members are just going to bully themselves in,” one warned.

Another said, “I get the sentiment and the idea behind [it] but there is no reasonable way to enforce it without causing a headache, upsetting people, getting employees harassed, etc.”

It’s too soon to see whether this policy change will inspire more members to upgrade to the Executive tier. But if too many people upgrade, then early store hours will effectively cease to be an exclusive benefit.

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